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tv   Real Money With Ali Velshi  Al Jazeera  January 1, 2014 3:30am-4:01am EST

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we turn to projections by zillow. the firm forecast that home price also increase 3% in 2014. to put that in con text, prices went un7% this year through november. as stewar the federal reserve pulls back, some good news for first time home buyers. it will be easier for borrowers to get a mortgage next year.
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a slow down in home appreciation could also be a good thing for home buyers in a number of reality markets. we're joined now from seattle. first of all with housing prices cooling, explain again why this is good news for home buyers? >> you know, it's been such a frenzy in 2013. if you were one of the markets like las vegas or phoenix you saw firsthand what a challenge it could have been. you were experiencing bidding wars, squeezed out by investors, putting down all cash offers. it was an extremely tough market to be in. next year a that situation will relax and we'll see more inventory on the market where you'll actually find a house. and investors are going back a little bit so you'll have less competition, and you'll be able to find a house and put an offer in and hopefully get that house, too. >> we have a map that we'll show of some of the hottest areas of the country. what is it about these
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particular areas that makes them particularly competitive and why housing prices will continue to swell in these areas? >> you know, a lot of hot markets in 2013 pro also the markets that lost most in terms of home value during the down turn. you created a lot of negative equity. floor, detroit, phoenix and los angeles saw extreme drops in home value oftentimes more than 50% on the way down. and so these homeowners lost a tremendous amount of their value and a lot of times they were left underwater, meaning they owed more on their mortgage than their house was worth. these homeowners were locked in their house and could not sell when home prices started going back up again. and since they were locked into their homes, supply in those markets was really tight. and that tight supplement you had a whole lot of demand super
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investors in those areas. those areas were still very popular. investors were coming in, normal consumers had demand for homes and there was little on the market to buy. there was a lot of demand, little to buy, and economics 101 means prices will be driven up. >> the director of economic research at zillow. thank you, we appreciate it. >> thank you for having me. >> zillow calls san josé in california one of the highest prices. we have a realtor based in san francisco, what is it about san francisco and san josé that makes those two markets so high? >> first of all, look at the view behind me. that says a lot right there. it's beautiful, very desirable place to live. and i think what's driving the market right now is the tech boom. for example, san francisco
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proper, twitter has just set home base there. and google has moved into the city. sales forces building a large building downtown creating the atmosphere and it's very exciting. the city is just vibrant right now with a lot of young tech people who are doing well financially, and also the companies that are financing these tech firms are living in the city and moving their offices here as well. >> are these real estate prices sustainable? these incredible increases. great in the short term but in the long term how do they sustain it? >> after the 2008 crash we had a dip and it did affect the san francisco market, but we're back. it's affected the bay area. the 25%, i believe it's the metropolitan area. they are also including areas like oakland and parts of the east bay and north bay that got hit pretty hard and still struggling last year.
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now with the lack of demand in the city people are moving out of the city and buying. i think that's why we've seen that market increase. areas in the north bay are becoming very popular as people are moving out. it's sustainable for a while. i think i expect to see it growing in the next year or two. >> will mortgage rates going up, will that put something of a damper on it? >> i think in the city proper it will help the market. it will strengthen the market, in fact. when people hear that the interest rates are going to rise, people want to move and buy a house as soon as possible. so they're not caught in the high mortgage rate to pay a high motor rate. sellers will say the same thing. we need to put our home on the market now while it's hot. in the immediate sense it will
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spur the market. i don't see the interest rates going above 6%, 7%, 8%, and getting to a point where will il have a negative affect on the market. san francisco is a dynamic, beautiful city, it's magnificent. >> i'm with you. no surprise that san francisco continues to be hot. thanks for joining us. >> thank you. >> there is no disputing 2013 was great for u.s. stocks. the dow jones industrial average and s&p closed out 25% in year to year gains. the tech heavy nasdaq saw gains. and across the bond europe's index gained 17% for the year. german among the top performing markets which rose 25% of the year. but it was ireland who did the best rising more than 33% following it's own financial bailout program.
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finally a mixed bag in asia, fell 6.8% making it the worst performing market in asia. japan's benchmark index soared 56% thanks to the japanese government massive economic stimulus program. this was the best year in japan since 1972. one asset class that didn't hold up so well this year, gold, which posted it's first annual loss since 2000. prices dropped 28% due to anticipation of the fed pulling back stimulus which will become a reality in the new year. a new year and brand new health plan for millions of americans, but that's not all. we'll run up the changes kicking in that could affect you even if you already have insurance. later bowling for dollars. economics 101, and why it should matter to most fans. that story and more as real money continues.
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>> new year's day is the start of a big year for the affordable care act. many provisions kick in tomorrow. we have the key days to watch out for and what it all means. >> today americans who have been forced to go without insurance can now visit and enroll in affordable new plans. that starts today. >> reporter: that was president obama on october 1st when the nation's insurance exchanges went live. but what happens now? for individuals the next big
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milestone is new year's day when the bulk of the health reforms take effect and that's the earliest day that coverages kick in. the uninsured have another three months to get covered, or face a fine at tax time if they haven't picked a plan on march 31st. the term pre-existing condition becomes a thing of the past. insurers can no longer deny coverage if you're sick. and if you're suffering from an illness like cancer and want to take part in a clinical trial your insurer can't drop you because of a decision. a family of four earning up to $32,000 a year wil will be eligible for free coverage. although only half of the states
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have decided to join the new program. under pressure after insurers began to drop the plans of million americans president obama offered states and insurers an opportunity to offer their own policies even if they don't meet the new requirements. but starting in october insurers may no longer a be able to renew those old plans unless they were grandfathered in. now what if you're an employer? there are big changes coming for you, too. after a series of delays the online marketplace for small businesses is set to open in november when next year's open enrollment begins. it begins with employers with less than 50 employees, and they could be eligible for tax credit if they decide to join. if you run a bigger company you have another year before you're required to cover all of your full-time workers or pay a fine. now here's a big one. starting january 1, 2018, the law emposes a 40% tax on
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employer plans that cost more than $10,200 a year and 27,500 0 for families. the idea is to reduce costs to make employers more discerning in the plans they offer their workers. but for now as america's health reforms roll out all eyes are focused on how many people buy coverage on the new exchanges. al jazeera, new york. >> much of the success of the affordable care act depends on enrolling the so young so-called invincibles. getting them on board is key considering the cost insurers take on when we see these milestone dates. do you see data that suggests the number of people who are healthy are up around 37% to 38% in the overall pool that the insurance companies are looking for? >> it's very hard to tell if the healthy are joining or not. because the health insurance
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cannot discriminate they don't ask questions about people's medical status. they'll find out if they're signing up the healthy people. what they can figure out now if they're getting the younger individuals or older ones. the initial data made it look like it was mainly middle age or older people signing up but in recent weeks you see younger people signing up, and as we go through the new year there will be more young people signing up. >> if it does not moot its target goal does a that mean tht insurance costs could soar next november when insurance companies set their rates. >> 2014 is very important year for this whole concept of health insurance exchanges. if the insurance companies get a good mix of older people, younger people, then they'll be able to keep their costs in line and maybe more insurers will
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sign up for the 2015 enrollment period and price also stay stable and go down. but on the other hand if things get out of control, and you see insurance companies withdrawing and boosting their rates, we'll see what happens midyear or later. >> what is the biggest change you think consumers ought to keep in mind as we go into shoe here? >> well, i think for those that are at a corporate job where they're staying just for the insurance, maybe they have son or daughter that has chronic condition, this job lock could be eased. they would be able to leave their job and start a business or go to a smaller company without fear of losing their insurance or paying astronomical rates. >> david williams, thanks for being on the program. >> my pleasure. >> and it is primetime for college football. more companies are jumping on board with bowl sponsorships and naming rights. someone is getting a big pay off and it's not the college athletes.
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we'll take a look at the impact on your wallet just ahead on "real money."
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the stream is uniquely interactive television. we depend on you, >> you are one of the voices of this show. >> so join the conversation and make it your own. >> the stream. weeknights 7:30 et / 4:30 pt on al jazeera america and join the conversation online @ajamstream. >> 2013 was the jeer of virtual currency of boyt bit coin and it exploded on the scene.
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earlier this month it's value soared to $1,200 before settling around $800. high venture capital firms have invested in star start ups rande look at competitors. >> reporter: born in the wake of financial crisis, bit coin emerged as the digital currency that in theory could not be manipulated by a central authority. when you buy something electronically using traditional currencies like dollars, pesoss or yen, it passes through an intermediatary like a bank. bit coin's appeal is that it transfers from one person to another. it's verified by computers that prevents fraud and keeps the supply of bit coin growing. >> the fact that theres is not
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one point of failure, the bit coin network is incredibly give to hack in the traditional sense, those are the things that come from its decentrallalized nature, and those are the things that make it appealing to people who are joining this revolution in money. >> reporter: the bit coin user network is made up of miners who compete to verify transactions with a time stamp. think of a postmark on the envelope. the miner or group of miner who is solve the problem first are rewarded with a small transaction fee and 25 new bit coins currently worth $20,000. that handsome payoff has spawned an arms race of source that threatens the nature of the bit coin. it is solved much faster by dedicated hardware that is far
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more powerful than your garden variety pc. professional miners are organizes themselves in pools that are crowding out the little guys. >> you may in the future start seeing something like an opec of digital currency miners. >> the specker of a bit coin cartel is one reason why it's rising in its shadow. first runner up is light coin. edge $600 million compared to bit coin's $9 billion it's designed for a home computer. the peer coin claims to have a more democrat mining process than bit coin. like bit coin they're highly volatile. some can be bought and sold on exchanges. no matter how attractive they come to investors, some governments don't like digital currency.
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india has put a ban and china has put a ban on handling bit coin. still there is no putting the genie back in the bottle. >> humans have figured out how to send money over the internet instantaneously without an intermediary. this is not something that people will forget how to do and this is not something that governments can stop. >> reporter: al jazeera new york. >> there were "r" many --there are many bit coin skeptics. so beware. they found a quarter had experienced security breaches and half had closed shop, and in some cases customers were not reimbursed. 35 bowl games will be played, that number will go to 39 next year and it seems that every bowl is tied to a company name.
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the games also generate revenue from ticket sales in merchandise. where does all that money go? patrick, professor and director of sports impact that conducts research of super bowls, all-star games and more. patrick, $15 million to $20 million for naming rights, who gets that money? >> some that have money is going to the conferences of the schools that participate in the game. stanford and michigan state, that means that the pac 12 and big 10 are getting a lot of that money. and of course the people who organize these games, the ceos of the bowl games, you see payments sometimes anywhere from $300,000 to $1 million for putting on one game a year. >> $1 million for putting on one rose bowl. >> that's a pretty good payout. >> that's amazing. what about the corporations themselves who are shelling out
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the money for the ceos to put on the games and they get their name associated with the bowl. what do these corporations get? >> typically speaking you'll see that it costs somewhere between $200,000 to response arrest bowl game to , and usually sponsors have to commit for three or four years. they're getting visibility and exposure, are they seeing a spike in sales? most companies are not going to share that information unless the information is positive. >> is this about vanity? the executives of visio and at&t, they like to be associated with college football which a lot of people like. >> you look at the biggest sponsors, visio, tostidos. they like the visibility, they're obviously getting exposure and branding, and
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that's valuable. now whether that translates into sales, only they know. but then you have some of the smaller sponsors like the royal purple vegas bowl. royal purple based out of texas. they decided to put their name on the vegas bowl for the next three years. sometimes companies want to expand their reach in some part of the county country, in this e from the south to the west. >> and bottom line, someone might have to pay more for tostidos, because they're shelling out a lot of money for these bowls, and they may not be getting their money back. >> that's true. >> patrick, thank you for being with us. we appreciate it. >> you're welcome. >> today on twitter and facebook we're asking you are you mor mor less inclined to to visit a
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sponsoring company: >> tell us what you think by tweeting us @ali velshi or leave us a comment on facebook. the top resolutions in america are to lose weight, exercise more, get a new or better job and improve your financial budgeting. our mission is to help you. here is some advice. in 2014 eat fried foods just twice a day instead of three times. walk daily. put your resumé in a pdf form and once a month just think statement. it's easy. but what is more difficult is tackling some of our deeper thoughts and feelings. are you somebody who struggles or messes up? who dwells on past mistakes, who tries to do right, and imagines they are a sham and thinks they are not the person they can and should be? me, too. and so is nearly every other human being on the planet.
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the fact is we all have south doubts in common. recognizing that, however, can be a challenge. here is a simple resolution. in 2014 try to be 4% nicer to everybody, including yourself. just 4%. and carry around antibacterial gel. don't overthink this. just trust me. 4%, and gel, you can be that person and it will help all of us in 2014. happy new year. that's our show for today. on wednesday, how entrepreneurs and innovators are reinventing how american families will live in the future. i'm david shuster in for ali velshi. from all of us at "real money" and al jazeera, happy new year. check check check
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>> >> welcome to al jazeera. i'm stephanie sy, here are the top stories. >> [ countdown ] >> and with that the new year begins. supreme court justice and bronx nati native led the count down. >> a new year's promise from russian president vladimir putin, vowing to fight those he labelled as terrorists until their destruction. three dozen people were killed in two suicide bombings in volgograd. security has tightened